NCLT orders liquidation of budget carrier Go First

The National Company Law Tribunal (NCLT) on Monday ordered the liquidation of Go First Airways, reported Bar and Bench.

A bench comprising Judicial Member Mahendra Khandelwal and Technical Member Dr. Sanjeev Ranjan allowed an application filed by the Committee of Creditors (CoC) seeking the airline's liquidation.

“Liquidation is ordered,” the bench was quoted as saying.

The detailed order is awaited.

Go First, operated by Wadia Group, filed for voluntary insolvency under Section 10 of the Insolvency and Bankruptcy Code (IBC) on May 2, 2023.

The budget carrier owes a total of ₹6,521 crore its creditors, which include Central Bank of India, Bank of Baroda, IDBI Bank, and Deutsche Bank.

The plea was admitted by the NCLT on May 10, 2023, and a Resolution Professional (RP) was appointed to oversee the airline’s operations.

The airline's troubles deepened as lessors challenged the moratorium imposed under the IBC, which barred them from reclaiming aircraft despite lease terminations. The National Company Law Appellate Tribunal (NCLAT) upheld the moratorium in May 2023, directing lessors to approach the appropriate forum for clarifications.

The Directorate General of Civil Aviation (DGCA) initially resisted deregistering Go First's aircraft. However, following a clarification from the Ministry of Corporate Affairs in October 2023, stating that Section 14(1) of the IBC did not apply to aircraft transactions, the DGCA agreed to the deregistration. By May 2024, Go First’s entire fleet was deregistered, and the aircraft were handed back to lessors for maintenance and export.

The CoC, faced with the absence of operational aircraft and no viable resolution plans, resolved to liquidate the airline in September 2024 and filed the requisite application with the NCLT.